The Euro area economic data for today improved with the composite unemployment rate dipping to 10.7%, from 10.8% previously. The German Manufacturing PMI for November came in at 52.9, above the expected 52.6, up from previous 52.1. German unemployment rate dipped to 6.3% in November, compared to the previous 6.4%. The number of unemployed also dipped by 13K compared to expectations of a 5K drop. Improving economic data along with the fact that market is pricing in aggressive rate cuts to the deposit rates may lead to the ECB under delivering on market expectations at the meeting on Thursday which may cause a short-term bounce in EUR post the ECB press conference.

GBP has softened slightly post the UK Manufacturing PMI for November which came in at 52.7, below the 53.6 expected, also down from previous 55.5. We see direction for GBP to be dictated by news from abroad this week which remains aplenty. Most important data from UK will be the services PMI on Thursday which is expected to improve slightly to 55 from 54.9 previous. Elsewhere, the Swedbank Manufacturing PMI came in at 54.9 versus 53.9 expected, also up from previous 53.5. SEK remains the third strongest G10 currency over the past week & month. From Norway NIMA Manufacturing PMI came in at 47.6 versus 48 expected, the number remains fairly low and exposure could be gained going short NOKSEK.

The RBA left rates unchanged at 2% and the accompanying RBA statement through no surprises and maintained a neutral message. Also China manufacturing PMI also came in line with expectations which have provided AUD with some further boost. AUD remains the strongest in the G10 currencies over the past month and may rise further versus the other G10 currencies (exception being USD), if GDP data on Wednesday comes in line with expectations of a 0.7% rise in Q3. The AUDUSD is likely to be dictated by US data this week.

Rahul is an FX Strategist for the TraderMade Research team.Follow Rahul on Twitter to see his intra-day updates...Check out the TraderMade Research service...